Tax Relief

Texas lawmakers are contemplating measures to ease property tax | Texas

(The Center Square) – After Governor Greg Abbott was inundated with phone calls from grassroots activists urging lawmakers to make property tax break an item on the agenda for the special legislative session, Governor Greg Abbott added it as one of 11 legislative items to be dealt with this month should be.

The special session began on July 8th and lasts 30 days, after which the session can be extended for a further 30 days.

The addition of property tax breaks “is a big win for taxpayers,” Texans for Fiscal Responsibility said in a statement. “But the question still remains, how much relief is granted? So far, only a few land tax bills have been tabled and the status quo has continued. Further exceptions and outsourcing to the detriment of the majority of taxpayers. “

Abbott may use federal COVID bailout money to pay property taxes, some have speculated but the governor’s office has not confirmed it. A second special session was convened for the fall to provide around $ 16 billion in federal funds.

The money cannot be used directly to replace the state’s tax revenue, notes State Representative James White. But there doesn’t seem to be any restrictions if lawmakers were to provide additional revenue to local government units like school districts under statutory tax compression, he says.

Texas is still having economic repercussions from job losses and small business closures due to the COVID-19 shutdown, while property taxes are rising due to “skyrocketing valuations,” argues White.

“The ability to buy, own, develop and sell real estate is a cornerstone of free societies,” says White. “The Texan property tax is the most existential threat to our culture of rugged individualism and the free market economy. Too many of our young people are openly committed to socialism because they don’t see themselves as” skin in the game ” . Successful property tax relief is sensible, measurable and maintainable. “

MP Hugh Shine has already filed Property Tax Relief Acts HB 223, HB 224 and HJR 21. Shine says he’s working on them with Rep. Donna Howard and Sens. Paul Bettencourt and Lois Kolkhorst.

HB 223 and HJR 21 relate to the total amount of value taxes that can be levied by a school district on the residence of an elderly or disabled homeowner, in addition to a property tax relief law that the legislature passed in 2019.

HB 224 would allow a new homeowner to receive ad valorem tax exemption for a new home in the year of the property purchase. Under current law, when buying a new home, a homeowner must wait until January 1st of the following year to receive the exemption.

“House Bill 224 is important because homeowners are currently losing a few months to almost a full year of their homestead exemption and are paying more property taxes than they should,” Shine said. “These laws will actually give Texans lower property taxes.”

State Representative Richard Pena Raymond also instituted a measure that would allow Texans to vote in November on a $ 5 billion reduction in residential school property tax. The tax cut is possible, he argues, “by using $ 5 billion from the Rainy Day Fund,” which would still leave at least $ 6.5 billion in the fund.

“People need and deserve a break,” said Raymond. “They need help. A $ 5 billion land tax cut would help homeowners across the state of Texas.”

According to a June 2021 poll by the Texas Public Policy Foundation, 76% of registered voters say property taxes are “a huge burden on them and their families”; 71% also say they would be angry “if the current legislative period ended without action against property taxes”.

Texas property taxes have skyrocketed 181% over the past 20 years, TPPF notes, far more than population growth plus inflation, a standard used to measure people’s ability to pay taxes.

In 2020, Texas local governments collected approximately $ 71 billion in property taxes, of which school districts collected $ 55 billion.

According to the State Comptroller Office, around $ 7.85 billion in general government revenue was not spent by lawmakers, resulting in a surplus. Michael Quinn Sullivan of the Texas Scorecard argues that the surplus should be repaid in full to taxpayers, which would reduce the property tax burden by 10 percent over two years.

The challenge, he argues, “is to ask lawmakers today to develop a mechanism for future surpluses to fund the relief and abolition of property taxes. The legislature could use these surpluses to further reduce the property tax burden in the coming years – and ultimately to completely abolish property taxes for schools. And if the legislature decides to cut spending … well, these property tax cuts could come even faster. “

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